Total No, of Questions : 6 RTS Total No. of Printed Pages : 12 Maximum Marks : 100 Time allowed : 3 Hours INSTRUCTIONS TO CANDIDATES Answers to questions are to be given only in English except in the caso of candidates who have opted for Hindi Medium, If'a candidate has not opted for Hindi Medium, hishhor answers in Hindi will not be valued Question No. 1 is compulsory Candidates are also required to answer any four questions from the remaining five questions. 1. (a) b) Working notes should form part of the respective answers State with reasons, whether the following statements are True or False : @) The financial statements are not prepared on the assumption that an enterprise is a going concern and will continue its operation for the foreseeable future. (i) Periodic inventory system is a method of ascertaining inventory by taking an actual physical count. (iii) The provision for discount on creditors is often not provided in keeping with the principle of conservatism (iv) If the errors are detected after preparing trial balance, then all the errors are rectified through suspense account. (») Both revenue and capital nature transactions are recorded in the Receipts and Payments Account. (vi) A fixed charge generally covers all the assets of the company including future one. (6 x 2= 12 Marks) Differentiate between Provisions and Contingent Liabilities. (4 Marks) RTS P.T.O.©) (a) @ RTS ‘A purchased @ machinery for € 1,30,000 on 1* April, 2019 and paid = 20,000 oe freight & installation charges. On I** October, 2021 another machine was ue for 50,000 and sold old machinery for % 1,00,000. ‘The machine purchast J* Octobor, 2021 was installed on 1* January, 2022. xisting practice, the com charging depreciation @ 20% p.a. on the Under existing practic ompany i ‘ging Sore original cost. Howover, from I* April, 2021 it decided to charge depreciation @15% p.a. You are required to prepare Machinery Ac ea fron jarks) 1" April, 2019 to 31 March, 2022, ¢ i The cash book of Mr, Karan shows ® 2,60,400 as the balance of bank as on 31* December, 2021 but you find that it does not agree with the balance bank pass book. On analysis, you found the following discrepancies () On 15% December, 2021 the payment side of the cash book was overcast by = 10,000. A Cheque for 1,18,000 issued on 6% December, 2021 was not taken in the as per the Gai) bank Column. On 20% December, 2021 the debit balance of & 8,460 as on the previous day, ii) sh book, was brought forward as credit balance in the Of the total cheques amounting to 12,370 drawn in the last week of December’ dv) 2021, cheques aggregating € 9,360 were encashed in December, 2021. () Dividends of © 35,000 collected by the bank and fire insurance premium of © 7,900 paid by the bank were not recorded in the cash book. (vi) A Cheque issued to a creditor of € 1,75,000 was recorded twice in the cash book. (vii) Bill for collection amounting to % 53,000 credited by the bank on 21* December, 2021 but no advice was recived by Mr. Karan till 31* December, 2021. (viii) A Customer, who received a.cash discount of 3% on his account of € 60,000 paid a cheque on 10! December, 2021. The cashier erroneously entered the gross amount in the bank column of the cash book. You are required to prepare the bank reconciliation statement as on 31% December, 2021 (10 Marks) RTS Tibbiiscaeisiatees@) fa) (3) RTS Before preparation of the Trial Balance, the following errors were found in the books of Hare Rama & Sons. Give the necessary entries to correct them. () Minor Repairs made to the building amounting to & 1,850 were debited to the Building Account Gi) An amount of € 3,000 due from Shayam Lal, which had heen written off as bad debts in the previous year, recovered in the current year, and had been posted to the personal Account of Shayam Lal mounting to * 20,000 has been entered in ased for office us Gi) Furniture pure the purchase day book. (iv) Goods purchased from Ram Singh amounting to t 8,000 have remained unrecorded so far. (v) College fees of proprietor’s son, t 15,000 debited to the Audit fees Account. (vi) Receipt of ¢ 4,500 from Meet Kumar credited to the Pinki Rani. customer and were taken. (vii) Goods amounting to € 6,200 had been returned by a in to inventory, but, no entry was made in the books, (viii) € 1500 paid for wages to workmen for making office furniture had been charged to wages account. (ix) Salary paid to a clerk © 12,000 has been debited to bis personal Account. (x) A purchase of goods from Raghav amounting to t 20,000 has been wrongly entered through the sales book. (10 Marks) T draws on d a bill of exchange for & 1,80,000 on 1* April, 2022 for 3 months J accepts the bill and sends it to T, who gets it discounted from his banker for © 1,72,800. T immediately remits © 57,600 to J. On the due date, T, being unable to remit the amount due, accepts a bill for € 2,52,000 for three months, which is discounted by J from his banker for = 2,40, J sends © 40,440 to T. Before the maturity of the bill, T becomes bankrupt and his estate paying fifty paisa in a rupee. (15 Marks) Give the journal entries in the books of T and J. RTS P.T.O. iia tt) (4) wad he following two sub-parts i.e either (i) or Gi) jo D Attem ONE of is i s took pla (i) ‘Tho following are the transactions that i period from 1" October, 2021 to 31% March, 202: Amount 2021 : © Oct.1° Balance duo to G by H en Oct. 18 Goods sold by G to H s Nov. 16 — Goods sold by H to G (invoice dated November, 26) 6,000 Dec.7 Goods sold by H to G (invoice dated December, 17) 5,250 2022 Jan.3 Promissory note given by G to H, at three months 7,500 Feb.4 Cash paid by Gto H 1,500 Mar. 21 Goods sold hy G to H 6,450 4,050 Mar. 28 — Goods sold by H to G (invoice dated April, 8) Draw up an account current up to March 31, 2022 to be rendered by G to H, charging interest at 10% per annum Interest is to be calculated to the nearest rupee. (5 Marks) Or (i) A trador allows his customers, credit for one week only, beyond which he charges interest@ 12% per annum. 1), a customer buys goods as follows Date of Transaction Amount ® January 2, 2022 60,000 January 28, 2022 55,000 February 17, 2022 70,000 March 4, 2022 42,000 D settles his account on 31* March, 2022. Calculate the amount of interest payable by D, using average due date method. Assume 9* January, 2022 as the base date. (G Marks) RTS«ny Rrs: 1G) Nani) ¥ are in partnership businoas aburing profits and losses in the ratio of 2:9, ‘how Nalauce Shoot ow at Me Mareh, 2022 i as follows Liabilities: Amount Assets Amount © © Capital Accounts Building 60,000 x 60,000 Plant 46,009 — OS : 9, 08D Y 140,000 Furniture 28,500 . - 6, = Goneral Rosorva 40,000. Debtors ga4oo - 149% S'S Craditors: 42,600 Bills roreivable 12,500 — 4 Noe ills payable 15,400 Stock 42.600 -— G7 9 Salary payable vom — 2,000 Bank 78,000 30,000 On 1 April, 2022 they docided to admit % into the partnorship giving bim 1/5% share in the future profits, Ho brings in © 1,00,000 as his share of capital. Goodwill as valuod at & 1, 20,000 at the time of admission of Z. ‘The partners decided to rovalue the assets and liabilities as follows : 000, Furniture © 20,000 and Bills Receivable (i) Plant & 40,000, Stock & 4 ® 12,000, (i) Out of total Debtors, € 2400 is bad and 6% provision is to be provided for bad and doubtful debts, (iii) Building is to be appreciated by 75%, {iv) Actual hiability towards sulary payable is © 1200 only. RTS PTO.(oy RTS hooks of the firm Your ara required ta show the following accounts in the C) Roviluation Account (2) Partner's Capital Aecounts ’ 0 Marks) (Balance shoot of the Firm after Adinission of Z (10 Marks) ) ‘The Income and Hxpenditure Account of the Young Boys Club for the year 2022 is as follows Expenditure, Amount Income Amount (©) © "To Salarion 2,750 By Subseription 8.500 ‘To Gonnral Exponsos 1,500 By Entrance Foos 250 To Audit fos 250 By Contribution for crotary’s Honorarium 1,000 Annual Dinner 1,000 ‘To Stationary and Printing 450. By Annual sports To Annual Dinnor expenses 1,500 moot receipts 750 ‘To Interost and Bank Charges 150 "No Depreciation 400 ‘To Surplus 1,500 “10,500, 10,500 RTS :(7) RTS his Account has been propared after the following adjustments Amount @ Subscription outstanding on gy December, 2021 700 Subscription received in advance on 31% December, 2021 550 Subscription received in advance on 31% December, 2022 370 Subscription outstanding on 31% December, 2022 750 Salaries outstanding at. the beginning and at the end of 2022 were respectively % 600. and © 450. General Expenses include insuranee prepaid ta the extent of © 150, Audit fee for 2022 is still unpaid. During 2022 audit fee for 2021 was paid amounting to = 200, The club owned a freehold lease of ground valued at € 20,000. The elub had sports equipment on 1* January, 2022 valued at & 2600. At the end of the year, after depreciation, the balance of equipment amounted to % 4,600. In 2021, the club raised a bank loan of & 5,000, This was outstanding throughout. 2022. On 31 December, 2022 cash in hand amounted to & 1600. You are required to prepare : @ Receipts and Payments Account for 2022 (ii) Balance Sheet as on 31 December, 2022 (iii) Balance Sheet as on 81* December, 2021. (10 Marks) RTS PTO,(8) RTS ‘Triple Column Cash Book from the following transactions of M/s Raj (a) Propare nd bring down the balance for the start of next month Agence 2022 x March 1 Cash in hand 30,000 1 Cash at bank 1,20,000 2 Paid into bank 10,000 5 Bought furniture and issued cheque 15,000 8 Purchased goods for cash 5,000 12 Received cash from Mohan 9,800 Discount allowed to him 200 14 Cash sales 50,000 16 Paid to Lata by cheque 14,500 Discount received 500 19 Paid into Bank 5,000 23° Withdrawn from Bank for Private expenses 6,000 24 Received cheque from Gupta 14,300 Allowed him discount 200 26 Deposited Gupta’s cheque into Bank 28 Withdrew cash from Bank for Office use 20,000 30 Paid rent by cheque 8,000 @ Marks) (b) Rand S are partners in a firm with a capital of 14,00,000 and 12,00,000 respectively. During the year ended on 31" March, 2022 firm earned a profit of % 6,50,000. Assuming that the normal rate of return is 20%. Calculate the amount of Goodwill of the firm by using Capitalization method Gi) Super Profit method, if the goodwill is valued at 6 years purchase of super profits, © Marks) RTS© a) RTS ‘The balance sheet of Son 1* April, 2021 was as follows : Particulars Amount Particulars Amount ® © Trade Payables 6,50,000 Furniture and Fixtures 650,000 Expenses Payable 75,000 Vehicle “2,75,000 Capital 22,00,000 Trade Receivable 11,00,000 Cash at Bank Inventories During 2021-22, his profit and Loss Aecount revealed a net profit of € 6,70,000. This was after allowing for the following : (@ Commission paid to selling agent € 65,000 (u) Discount received from creditors € 75,000 (iii) Purchased a vehicle of € 50,000 on 31* March, 2022 (iv) Depreciation on Furniture and Fixtures @ 10% and on Vehicle @ 20% (%) A provision for doubtful debts @ 9% of the trade receivables as at 31% March, 2022 But while preparing the Profit and Loss Account he had forgotten to provide for (1) prepaid expenses € 15,000 and (2) outstanding commission € 35,000. RTS PTO. issn(a) ) (10) RTS His current assets and liabilities on 31" March, 2022 were: Inventories % 6,50,000, Trade Receivables 13,00,000 (before provision for doubtful debts), cash at Bank 5,50,000 and Trade Payables ¢ 1,46,000. During the year he introduced further capital of € 3,00,000 into the business. You are required to prepare the balance sheet as at March 31, 2022. (10 Marks) PQR Limited issued 2,00,000 equity shares of t 10 each payable as t 3 per share on application, € & per share (including € 2 as premium) on allotment and % 4 per share on call. All these shares were subscribed. Money due on all shares was fully received except from Mr. J, holding 5,000 shares who failed to pay the allotment and call money and Mr. K, holding 10,000 shares, who failed to pay the call money. All these 15,000 shares were forfeited. Out of the forfeited shares, 10,000 shares (including whole of J’s shares) were subsequently re-issued to Mr. L as fully paid up at a discount of t 1 per share. Pass necessary journal entries in the books of PQR Limited. Also prepare balance sheet and notes to accounts of the company. (15 Marks) “The cost of Property, Plant and Equipment comprises of any cost directly attributable to bring the asset to the location and condition necessary for it to be capablo of operating in a manner intended by the enterprise”. Give any five examples of such ‘directly attributable costs’ (© Marks) RTS